Oracle brings in Q3 results, delivers first-ever cash dividend
As the company did last quarter, Oracle during their Q3 earnings call on Wednesday blamed currency exchange rates for hamstringing their earnings. As it was, the company reported revenues precisely meeting expectations for the third quarter, and announced its first-ever cash dividend of five cents per share.
GAAP earnings per share were 26 cents, up 3% year-over-year and up one penny since last quarter, which is exactly what the company predicted last quarter -- though that number was ironically predicated on a weaker dollar. Had exchange rates remained as they were in Q3 '08, the company says, earnings would have been up 18% to 31 cents per share. (Non-GAAP earnings per share were up 16% to 35 cents; with last year's exchange rates in effect, that would have been 40¢/share.)
Net income for Q3 2009 was $1.329 billion, down $11 million year-over-year. year-to-date net income is $3.702 billion, up from $3.484 billion a year ago.
Operating margins reported were, as president Safra Catz pointed out on the call, their highest ever for an Oracle Q3; CEO Larry Ellison noted that new license sales actually grew year-over-year this quarter. Both noted that the only bad news for the company this quarter was in fact that nagging currency rate.
That said, noted Ellison, "We're not in the business of predicting currency exchange rates; we'll leave that to George Soros... Currencies are gonna do what they're gonna do." More to the company's taste is continued emphasis on R&D and the constant sparring with Salesforce, SAP and other competitors, against which the company recited an impressive set of contract victories over the quarter; as Catz summed it up, "We feel like we're winning an awful lot."
Currency will continue to provide a bite in the shorts for Q4, Catz says. Fourth-quarter GAAP earnings per share are predicted to come in at 34-38 cents, if current exchange rates obtain; GAAP earnings under current exchange conditions are expected to be 42-46 cents/share. Assuming a constant currency rate from last year's results, those numbers would be 41-45 cents and 49-53 cents respectively.
The market was loving it late Wednesday, sending Oracle shares up to $17.04 at press time after closing the afternoon session at $15.83.